WASHINGTON, Sept 30 (Reuters) - The U.S. government and the
body in charge of assigning Internet addresses signed an
agreement on Wednesday that allows for greater global
participation in the Internet domain name process.

The U.S. Commerce Department said it reached an agreement
with Internet Corporation for Assigned Names and Numbers
(ICANN), drawing praise from U.S. lawmakers, who wanted more
trademark protections, and companies and international
officials seeking greater independence from U.S. control.

The agreement, which allows ICANN to become a "private
sector led organization," subjects ICANN to periodic reviews by
a panel that includes a U.S. representative and independent
experts, essentially allowing the organization to no longer
report solely to the United States.

Ending an 11-year partnership with the U.S. Department of
Commerce, the pact also provides stability for companies such
as Verisign Inc (VRSN.O) and Go Daddy that sell domains and
maintain extensions like ".com".

It also comes months after the European Union said ICANN
should be delinked from the U.S. government and made fully
independent.

"The pie actually became bigger" for greater involvement
from other governments, said Larry Strickling, administrator of
the Commerce Department's National Telecommunications and
Information Administration, who signed the agreement.

Before the signing the U.S. government wanted certain
conditions -- largely driven by concerns from lawmakers -- to
be met, including keeping ICANN a nonprofit organization
headquartered in the United States.

In support of the deal, U.S. Representative Rick Boucher,
chairman of the House Energy and Commerce Subcommittee on
Communications, Technology, and the Internet, said ICANN has
promised it will address various issues, including consumer
protection and trademark matters, before implementing new
domain names.

"This agreement gives international stakeholders an even
more powerful voice in our activities moving forward," ICANN
Chief Executive Rod Beckstrom said in a statement.

Set up in 1998, ICANN was operating under the aegis of the
Commerce Department, an arrangement that raised concerns by
some that said the Internet is not seen as belonging to a wider
global constituency. It decides on what names can be added to
the Internet's top level domains (TLDs) such as .com as well as
country designations.

The California-based organization has been in the spotlight
over whether or not it should include .xxx for pornographic
Websites. In 2007, it rejected a petition to include that
extension as a TLD.

In 2008 Internet regulators voted to relax rules on domain
names such as .com or .edu, paving the way for companies or
individuals to create an array of new addresses for the Web.

Under the new system, individuals, companies or groups
could apply to have any string of letters established as a
domain name. It could be a vanity name, for example -- .smith
-- or a category name such as .sports or .perfume.

A company could also change its domain to reflect its
brand, so Apple.com could become Apple.mac, for instance.

Vint Cerf, Google Inc's (GOOG.O) vice president & chief
Internet evangelist -- known as the "father of the Internet" --said the pact fulfills a long-standing objective which is to
"create an organization that can serve the world's interest in
a robust, reliable and interoperable Internet."

Even with the looser relationship, the U.S. government will
take part in reviews of ICANN, which is expected to start
taking hundreds of applications for new TLDs early next year.

A survey conducted by the Future Laboratory earlier this
year showed that two-thirds of businesses were unaware they
will be able to use their own name in place of domain
extensions such as .com, .org or .net when Internet domains are
liberalized next year.

With a fee of more than $100,000, applications are expected
to be limited to large corporations and organizations.

Key U.S. lawmakers who had previously raised concerns
praised the agreement.

Boucher said the agreement will ensure transparency and
accountability from ICANN and include periodic reviews of
ICANN's performance.

The European Union also welcomed the agreement. "This is a
significant positive move towards a new and more open 'working
environment' for ICANN and this document provides a good basis
for further improvements," Swedish Infrastructure Minister Asa
Torstensson said in a statement.